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Our latest Business Perspectives trend report looks at our current topic of Management Now: tomorrow’s demands on today’s leaders. The report considers the wider world of the future manager, focusing on mindset, culture, technology, agility and current trends.

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Here we introduce you to our seventh Business Perspectives summary report in the series. This report takes a look at the wider world of Trust and the latest trends relating to social media, content, personalisation, responsibility and work and culture.

It also showcases highlights from the masterclass in London which focused on The Power of Trust within the workplace. If you missed it, you can watch video highlights and join in the discussion with The Power of Trust webinar on Thursday 12 June at 7pm (BST).

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This content first appeared on HRZone, an online HR publication dedicated to bringing science, opinion, analysis and insight to bear on the rapidly-developing HR function.

Culture plays the role of cement in binding the members of a group together. If cement is not good it malfunctions and affects the bond that exists between the members of a group. If the element of trust misses from culture then mistrust creeps in. Mistrust weakens the relationship among the members of a group. Furthermore, it becomes difficult to achieve a common goal in the presence of mistrust. Now look at mistrust in the context of an organisation. It weakens relationship among the members of an organisation. Employees feel vulnerable as they are always suspected. Workers do not give their best that affects production, services and sales. Organisational profits decrease. Issues of workforce engagement arise and employee turnover increases. Chances of cheating and deceit within organisation increase. Different studies have revealed that almost 60-65% employees of companies do not trust their leaders. Reason is absence of the culture of trust within organisations. Obscure agendas, concealing organisational aims & goals, dishonest and unbiased leadership, tax evasions, employee benefit cuts, lack of readiness at the part of organisational leadership to hear employee feedback, unclear performance goals and hidden employee performance measuring scales are some of the major reasons for the culture of mistrust in organisations.

After facing the consequences of the culture of mistrust now organisations are realising the importance of trust. Therefore, all around the world companies are trying to make cultural changes in this regard. But cultural change is not as easy as it sounds. It takes time, commitment and efforts to replace the culture of mistrust with the culture of trust. The following practices are helpful in building the environment of trust:

Study the actual reasons of mistrust and learn about the damages it is causing.

Always have clear aims & goals in front of you that what do you want to achieve by having the culture of trust in your organisation.

Create a clear program in this regard. Have workers on board during the course of crafting it.

Set performance measures to gauge the performance of the program. Satisfied workforce, low employee turnover and increased profitability can be some of the performance measures in this respect.

Leadership must take the first step in this regard by being as role model. Cultural change travels fast from top to bottom.

Leaders should reduce the say-do gap.

Fulfil promises that are being made with the workforce.

Make your workforce understand the importance of trust. Offer training and courses in this regard.

Not just in their professional lives leaders must try to be honest in their personal matters as well.

Do not over estimate your employees always assign those goals to them that they can achieve.

In case of failure be polite and generous.

Always separate dirty fish from the rest in order to avoid setbacks.

Remember in many cases mistrust spreads due to unclear and biased programs of performance management in organisations. Create a clear and fair system in this regard and award rewards on the basis of performance.

Tell inspiring stories to your workforce in regard of trust.

If an organisation is making cultural changes in terms of trust it does not mean that its leaders close their eyes and start trusting everything they hear, they must always keep their eyes open to avoid any setbacks. Keep it in mind that it takes time to clear the poison of mistrust from the environment of an organisation, thus be patience. Environment of trust takes time to grow. Leadership of an organisation plays the most important role in it.

Innovation in some respects is like the Holy Grail of business – How do you do it: disruptive or continuous? How do you foster it in your organisation: Incentives? Creative downtime? Hire the right talent? Although these are obviously worthy avenues to explore, they do take time to implement.

Is your organisation agile enough to foster innovation?

I think many organisations are hampered by their internal environment which prevents a dynamic, agile response to market change. There is definitely a tension, in my view, between Grant’s internal resource perspective and Porter’s economic view of the workings of the external business environment.

From a practical perspective, I also think many companies find it hard to innovate through disruptive change. In my view, the larger and larger an organisation becomes the more bounded I feel it is to its BAU (Business as Usual) and the day-to-day constraints that just “getting things done” place on its internal environment.

The leaner, younger, more nimble upstart is likely to steal a larger company’s thunder and swiftly re-engineer the external environment. Think of Apple launching the iPod – a lower quality sound compared to compact discs so Sony engineers believed at the time – a product that rapidly caught the attention of a mass market interested in synching their PC to a portable, lighter device. In the end, a good quality product (CDs) lost out to unperceived customers’ needs and wants (iPods).

I think it is this disconnection from the customer which fosters continuous improvement in an organisation rather than disruptive market change. As a product or service exists already and a level of stakeholder engagement is in play – internally and externally – it becomes safer to adapt and improve a product or service rather than launch new ones. Why ruin a good thing?

It is also seems safer to improve the operational side of an organisation by being leaner and more cost-effective rather than radically altering the product or service and risk a customer backlash: something Coca-Cola experienced when they launched new coke in the 1980s. Why risk upsetting the apple cart, and more importantly, an organisation’s shareholders by changing the status quo?

There are certainly many barriers to innovation in organisations – people, culture, shareholders to name a few – and varying ways in which to be innovative. In my mind, how an organisation chooses to innovate is contingent on a range of external and internal factors. And also its strategic, longer-term vision of what the future holds.

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Guest blogger: David Mayle, Lecturer in Management and a member of The Open University’s Centre for Human Resource and Change Management.

Talking of quotes, I’ve always been fond of Nick Negroponte (he of MIT Media Lab fame) and his

“The best way to guarantee a steady stream of new ideas is to make sure that each person in your organization is as different as possible from the others. Under these conditions, and only these conditions, will people maintain varied perspectives and demonstrate their knowledge in different ways.”

Trouble is, such diversity is a necessary but not sufficient pre-condition for innovation capability; that people are different is not enough – they’ve got to be allowed to think and behave differently too.

Which brings us to culture. I’m not going to dwell on definitions, at least in part because all too often we believe – erroneously – that if we can pin a label on something, it helps us to understand it. If only.[1] Culture is deep; culture is slippery; culture is unmanageable; all of the usual claims are true, partial, and largely unhelpful.

In very crude terms, culture may indeed be – at a quite deep level – the way the place ‘works’, but for the purpose of this discussion, I’m going to tweak that a little, into ‘… so what does one have to do to get on around here?’ My motives should become clear a little later.

If culture is such an elusive concept, how do cultures emerge in the first place? In the beginning, an organisation has purpose but generally few people; if the initial ideas prove successful, it usually grows. This means a balance between two processes: recruitment (= who comes on board) and retention (= who stays).

Let’s take recruitment first. I often tell my students that there are two rites of passage en route to becoming a good manager. The first is to stop recruiting in your own image[2]; most of us eventually achieve this. The second is to start recruiting people who disagree with you[3]. This is much more difficult and sadly many don’t get that far, notwithstanding its increased popularity after both Gordon Brown and Barack Obama started recycling some of Abraham Lincoln’s political philosophy. Given these two rules, it should be quite clear that recruitment, who does it and against what criteria (explicit or otherwise), is a crucial lever on culture.

Then there’s retention; if folk find the environment conducive they’ll probably stay, if not they’re more likely to leave (going back to the quote at the start, do they feel they’re allowed to be different or do they feel pressure to conform?). I will also argue that retention is intimately tied up with the reward system in place, which needs to be three things: it needs to be perceived as being fair, it needs to be congruent with the organisation’s aims[4], and it needs to at least allow (or even actively encourage) people to be different. People who are rewarded by the organisation are the role models, to be emulated by all those others who want to ‘get on’. And if only one sort of behaviour gets rewarded, bang goes your diversity.

Some of us believe passionately in the power of innovation; problem is, if culture is so vital, and recruitment and retention/reward are key, who’s got their hands on the levers?

[1] OK, if you insist on definitions, the seminal article is probably Schein (1990) ‘Organizational Culture’, American Psychologist (February)

[2] If you doubt it, go back to your Belbin, or maybe some Myers-Briggs, or maybe just look again at the Negroponte quote.

[3] I cite John Cleese in a famous video where he quotes Sam Goldwyn: “I don’t want any Yes Men in this organisation, I want people to speak their mind. Even if it does cost them their job!”

[4] The classic text is Steven Kerr (1975), ‘On the Folly of Rewarding A While Hoping for B’, Academy of Management Journal